New York state crackdown on short sub-lets

Some New York residents say sub-letting is the only way they can pay the rent. Photo / AP

Each night, people in apartments all over New York City are cleaning up, putting out fresh towels and clearing out - to rent their private space to strangers from around the world.

Thousands of city residents are using websites such as Airbnb.com to list apartments or rooms for as little as US$35 ($42) a night, a phenomenon officials say is illegal in many cases, undercuts the hotel industry, avoids taxes and threatens apartment building safety.

New York state's attorney general is demanding that Airbnb turn over data on city dwellers who have listed on the site as part of an investigation into whether residents are breaking a state law barring sub-lets for fewer than 30 days if occupants are not present.

But many residents in the most expensive US city say they're providing a service that's valuable to them and their guests. Sub-letting for nights at a time is often the only way they can afford to pay rents that average US$3000 a month and can often top US$6000 in the most desirable areas.

"I use Airbnb to supplement my income, and it's allowed me to go back to school," says Mishelle Farer, a 32-year-old former army sergeant who rents her second bedroom in Brooklyn's artsy Williamsburg neighbourhood through Airbnb for US$60 to US$70 a night, depending on the season. Farer says she covers about half her rent through such sub-lets. And besides, "I've met so many wonderful people from France, Germany, Spain, South Africa, Brazil, the Philippines."

Travel guide author Pauline Frommer says Airbnb and smaller sites such as flipkey.com, couchsurfer.com and housetrip.com fill a need in a city where hotel prices average US$275 a night. "New York hotel prices are truly outrageous. The city is overwhelmed with visitors, and it's practically impossible to find an affordable hotel room, so you need some kind of outlet."

Airbnb started five years ago in San Francisco, after two roommates couldn't afford their rent and inflated air beds for paying guests. It now operates globally in 35,000 communities, offering 500,000 listings.

In New York, the company says about 15,000 people are offering short-term rentals. New York City has been aggressively challenging Airbnb, contending many sublets on its site are illegal because residents aren't there. And the city says such rentals are cheating the city of lodging taxes. Since the mayor's office began examining short-term rentals in 2006, it has fielded more than 3000 complaints and issued almost 6000 notices of violation.

Airbnb called the subpoena of customer information by Attorney General Eric Schneiderman an "unfounded fishing expedition" and says hosts are responsible for following varying laws around the world.